Banks and other corporations that proactively report possible employee crimes to the government instead of waiting to be discovered will get more lenient terms, according to a Justice Department official.
The DOJ recently overhauled its approach to corporate criminal enforcement to incentivize companies to root out and disclose their misdeeds, Marshall Miller, a principal associate deputy attorney general, said Tuesday at a banking conference in Maryland.
“When misconduct occurs, we want companies to step up,” Miller told the bank attorneys and compliance managers in attendance. “When companies do, they can expect to fare better in a clear and predictable way.”
Banks, at the nexus of trillions of dollars of flows around the world daily, have a relatively high burden for enforcing anti-money laundering and other legal and regulatory requirements.
But they have a lengthy track record of failures, often due to unscrupulous employees or bad practices.
The industry has paid more than $200 billion in fines since the 2008 financial crisis, mostly tied to its role in the mortgage meltdown, according to a 2018 tally from KBW. Traders and bankers have also been blamed for manipulating benchmark rates, currencies and precious metal markets, stealing billions of dollars from developing nations, and laundering money for drug lords and dictators.
The carrot that Justice officials are dangling before the corporate world includes a promise that companies that promptly self-report misconduct won’t be forced to enter a guilty plea, “absent aggravating factors,” Miller said.
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